Internal Sales Credit Note Applet

1. Overview

The Internal Sales Credit Note Applet is used to correct, adjust, or reverse previously issued sales invoices. Common use cases include:

  • Incorrect pricing or billing amounts
  • Returned goods or service reversals
  • Sales discounts issued after invoicing
  • Marketplace fees or post-sales adjustments (e.g. Shopee, Lazada)

A Sales Credit Note reduces the customer’s outstanding balance either by:

  • Contra against existing or future invoices, or
  • Settlement where actual cash movement occurs.

Important: Sales Credit Notes do not affect inventory quantities. They are purely accounting adjustments posted to the General Ledger (GL).

2. Prerequisites – Creating Account Code Items

Before creating a Sales Credit Note, ensure the required Account Code Type items exist.

Why Account Code Type Items?

  • Credit Notes post directly to GL accounts
  • They are non-inventory items
  • Commonly used for:
    • Sales discounts
    • Administrative charges
    • Marketplace transaction fees
    • Service reversals or adjustments

Option A: Create via Doc Item Maintenance Applet

  1. Click the Plus (+) button to create a new item.
  2. Enter:
    • Item Code
    • Item Name
      (Example: Sales Discount, Marketplace Fee)
  3. Critical Step:
    • Set Item Type = Account Code Type
  4. Go to the Company Linking tab:
    • Select the company
    • Assign the Default GL Code
      (Example: Sales Revenue Adjustment, Discount Given)
  5. Save the item.

Option B: Create via Chart of Account Applet

  1. Open the Chart of Account Applet
  2. Navigate to GL Code Create Item
  3. Search for the relevant GL Category
  4. Select the required GL Code
  5. Click Create Item

The system automatically creates and links the item as an Account Code Type.

Best Practice: Use this option to ensure accurate GL–Item mapping.

3. Listing Screen Navigation

The Listing Screen allows you to manage and monitor all Sales Credit Notes.

Search By

  • Customer
  • Branch
  • Sales Agent

Filter By

  • Creation Date
  • Transaction Date Range
  • Posting Status:
    • Draft
    • Final
    • Void
    • Discard

Common Actions

  • View transaction details
  • Edit Draft documents
  • Track posting, contra, and settlement status
  • Audit historical credit adjustments

4. Step-by-Step Credit Note Creation

Click the Plus (+) button to create a new Sales Credit Note.

4.1 Main Details Tab

Configure the transaction header information:

  • Branch
  • Location
  • Sales Agent
  • Transaction Date
  • Reference Number (optional)
  • Remarks / Notes
  • Currency
    • Forex transactions are supported (subject to configuration)

Default values may auto-populate based on user personalization.

4.2 Account Tab

  • Select an existing Customer, or
  • Click Plus (+) to create a new customer on the fly

The selected customer controls available Contra and Settlement options.

4.3 Line Tab

  1. Select the Account Code Item
    • Must be Account Code Type
  2. Enter:
    • Amount
    • Optional line remarks

Examples

  • Marketplace commission fee
  • Post-invoice discount
  • Service or billing adjustment

4.4 Status Management

Each Sales Credit Note follows a defined lifecycle:

  • Draft
    • Editable
    • No accounting impact
  • Final
    • Posted to GL
    • Available for Contra or Settlement
  • Void
    • Reverses accounting impact
  • Discard
    • Cancelled before posting

Only Final documents affect financial reports.

5. Contra vs Settlement Handling

Understanding the difference is essential for correct accounting treatment.

5.1 Contra

Purpose
Used to offset the credit note against existing or future invoices.

Typical Use Cases

  • Overbilling corrections
  • Credit applied to next invoice

Steps

  1. Go to the Contra Tab
  2. Click Plus (+)
  3. System displays open invoices for the same customer and branch
  4. Enter the contra amount
  5. Click Add

Contra does not involve cash movement.

5.2 Settlement

Purpose
Used when actual money is exchanged.

Examples

  • Cash or bank refund
  • Credit card refund
  • Marketplace payout after deducting fees

Behavior

  • Integrated with Cashbook / Bank modules
  • Updates payment and reconciliation records

Use Settlement only when real financial transactions occur.

6. Advanced Features

6.1 Importing Sales Credit Notes

  • Download the Sales Credit Note Import Template
  • Fill in required fields offline
  • Upload the completed file to create records in bulk

Recommended For

  • Marketplace adjustments
  • Monthly reconciliations
  • High-volume credit processing

6.2 App Settings

Administrators can configure:

  • Field visibility (e.g. Settlement Date)
  • User permissions on settlement editing
  • Posting and workflow restrictions

6.3 Personalization

Users can define:

  • Default Branch
  • Default Location

This reduces manual input and improves efficiency.

7. Accounting Logic (Debit / Credit)

When a Sales Credit Note is Finalized, the system posts:

EntryAccount
DebitGL account linked to the Account Code Item
CreditTrade Debtors (Customer Account)

Accounting Impact

  • Reduces customer receivables
  • Adjusts revenue or expense accounts
  • Fully traceable for audit and reporting

8. Key Notes & Best Practices

  • Verify GL mappings before finalizing
  • Prefer Contra for non-cash adjustments
  • Use Settlement only when money moves
  • Do not use inventory items
  • Use Import for bulk or recurring adjustments

9. Conclusion

The Internal Sales Credit Note Applet provides a controlled and auditable way to manage sales corrections and receivable adjustments. Proper usage ensures accurate financial reporting, clean audit trails, and operational flexibility.